Owner realized need for succession plan

Jim Webb was a typical small-business owner: visionary, demanding and totally in charge of his “baby,” Webb Design, a Tustin company that designs kitchens and dining areas for large facilities.

Five years ago he joined Vistage, a nationwide network of peer advisory groups, where fellow business owners impressed upon him the need to delegate in the company he started in 1989. That would leadWebb to develop a plan for the company to continue after he departed.

Such planning is difficult for founders who build companies that reflect their values and personalities. Many entrepreneurs never face the task, which is a major reason why three-fourths of even longtime, successful ventures don't survive into the second generation. In Webb's case, his family didn't want to take over the company, so he either had to plan to sell it or groom his successors. He chose the latter.

Webb's leadership in that grooming became more important after he was diagnosed with bile duct cancer shortly before Christmas in 2010. He put the final touches on the succession plan shortly before his death Oct. 24 at age 58.

Company leadership has now passed to managing principal Gina Brinegar and design principal Costel Coca. Their challenge is to build on Webb's vision that earned the firm local and national awards, including the 2012 Facility Design Project of the Year from Foodservice Equipment & Supplies magazine for designing and implementing plans for the Metropolitan State Hospital central kitchen in Norwalk.

“Jim was a leader, a typical entrepreneur,” Brinegar said. “He looked at the company at the 30,000-foot level, seeing ways to grow the business but protect his empire and his employees.”

Brinegar owned her own bookkeeping service, and Webb Design was one of her clients for years. While her children were young, she wanted the flexibility that self-employment allowed. In 2005, Brinegar became a full-time Webb employee with the understanding that someday she would take over operational management, she said recently.

Coca, whose family emigrated from Romania when he was 8, started working for Webb in about 1999. “Jim hired me to do the drafting for two Hot Dog on a Stick projects, then he hired me full time,” Coca said. “It probably took me five years to become part of the design process, … but I look back and if I had a choice, I would still choose this career.”

Webb's initial plan was to develop the staff so that he could semi-retire at 60, Brinegar said. First he had to decide whether to sell the company. “He decided he was going to have a sustainable company and handpick the people to carry on,” she said.

Brinegar was the first company employee to learn of Webb's cancer diagnosis. After keeping the secret for about six weeks, she visited him at Cedars-Sinai Medical Center in Los Angeles and insisted he tell the staff. “We drafted a statement together, and I called everyone into the conference room and I read it.”

Coca added, “He was in the hospital 25 days so everyone figured out it was major. Even when we found out, Jim was so positive about it that we thought he would recover.”

When Webb returned to work, he proceeded with a demanding regimen to prepare Brinegar and Coca to take leadership of their respective parts of the company.

“I was running the financial side, even as an independent contractor,” Brinegar said. “Jim was super demanding the last year and I told him, ‘You need to treat me as a partner so I learn along with you.'”

Coca described the transition as a mentorship. “We could go into his office and complain about anything. He had a graceful way, … but he wasn't a father to cuddle you. Going into Jim's office was the most painful thing I had to do, but every time I knew I had learned something.”

Brinegar added: “He wouldn't solve your problems for you. You didn't think you were learning anything but you were.”

As part of the succession plan, the company formed a board of directors that included business experts and representatives for Webb's family. Board Chairman Ted Dobson is a business owner and Vistage group chairman who knew Webb for 20 years.

Succession planning “is extremely important but often overlooked,” Dobson said. “Every business operates differently. … Part of the transition strategy is to make sure the business has all the resources it needs.”

Webb put off finalizing the succession plan until shortly before his death. The plan calls for Brinegar and Coca to make payments over six years.

The two said they were fortunate to have almost two years of learning and assuming more responsibility while Webb was away from the business undergoing treatment. By stepping up and doing the work, they proved to Webb and to themselves that the company was in capable hands.

“Two years ago, I wouldn't have been ready,” Coca said. “I think that made him more comfortable that he had made the right decision. Toward the end he came into the office not to run things but to keep himself going.”

Brinegar said, “This was his lifeblood. He liked to hang here. We had the opportunity to build the Webb brand so some of our clients didn't even know Jim.”

Although Webb's 14 employees knew he was sick, their industry colleagues didn't. Within hours of Webb's death, Brinegar started receiving calls of condolence and concern.

“Our industry is very principal-centered. When the owner is gone, the company dies. I had a couple of calls asking, ‘Are you going to close the company?'” she said. “I reassured them it would be the same Webb Design. Because we were doing this for almost two years, internally nothing was different.”

Cary Wheeland, senior vice president at Bon Appétit magazine, said, “Jim developed a team of professionals whose cutting-edge work is admired across the industry. We will continue to enjoy a strong relationship with the firm in the years ahead.”

That is what the new principals expect too.

Coca said, “In the industry, Jim was a trailblazer and a visionary. That legacy inspires us, but it's important for us not to pretend to be Jim. We have our personalities. We bought into Jim's vision way before we started this process. If we didn't, we would be someplace else.”